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BoJ Joins ECB And Fed On Unlimited Print Train

Tyler Durden's picture


Just as some do not believe in Santa, Christine Lagarde appeared to comment that she does not believe in currency wars (or competitive devaluation) this morning but sure enough, just a few hours later, Reuters rumors that the BoJ is about to join the Fed and ECB on the open-ended infinite print train. Sure enough, JPY is dumping (breaking recent highs on a stop-run), stocks are responding in their correlated carry way, and precious metals are surging (Silver +4.6% on the week) as fiat floods the world. It appears 2013 is the years of last last resort as the G-20 meme seems to be "if we can't reflate now, then it's all over." What is perhaps remarkable about the equity response is that everyone has known for two months that Japan plans on implementing a 2% inflation target. The only question has been "how" - and that it is only logical that the BOJ would use 'whatever means everyone else has used' - today merely confirmed this - knee-jerk algo response or sell-the-news? 



JPY dumping (higher is weaker vs USD in the chart)...


S&P 500 futures surged in their correlated fashion as JPY crosses all went risk-on...


and Gold surged...


Gold now leading the S&P since 1/3/13... +1.88% vs +1.36% from 01/03/13 close


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Thu, 01/17/2013 - 13:58 | 3162994 francis_sawyer
francis_sawyer's picture

Catfood bitchez! [go long]...

Thu, 01/17/2013 - 14:00 | 3163006 CPL
CPL's picture

When that runs out.


Thu, 01/17/2013 - 14:07 | 3163048 Lukacko
Lukacko's picture


Thu, 01/17/2013 - 14:12 | 3163069 Catch-22
Catch-22's picture

Printing  =  Inflation  =  Horse in Hamburgers…


Horse in beef: 
Tesco apologizes and refunds

While horse meat was found in beef steaks in Britain and Ireland, the UK distributor has issued an apology in the press. Tesco will reimburse customers.




Thu, 01/17/2013 - 14:25 | 3163128 busted by the b...
busted by the bailout's picture

Horse in Hamburgers…

Don't worry about it; chain-weighted inflation has it covered.

Thu, 01/17/2013 - 15:11 | 3163238 francis_sawyer
francis_sawyer's picture

I'll have the 'Secretariat' burger with a side of 'Sea Biscuits' please...


Edit: Junks?... That was funny as shit!

Thu, 01/17/2013 - 16:02 | 3163550 Orly
Orly's picture


Thu, 01/17/2013 - 16:35 | 3163705 francis_sawyer
francis_sawyer's picture

**ck you & the HAMBURGER you rode in on...


Now THAT was funny!

Thu, 01/17/2013 - 16:41 | 3163733 Orly
Orly's picture

It's a stretch but the "rode in on" wins by a nose.




Now THAT was funnier-er!

Thu, 01/17/2013 - 14:26 | 3163135 trav777
trav777's picture


Thu, 01/17/2013 - 14:30 | 3163155 Itch
Itch's picture

They are called Shergar burgers...

Thu, 01/17/2013 - 14:53 | 3163258 Random_Robert
Random_Robert's picture

mmmmm.... tasty pussy.

Thu, 01/17/2013 - 14:20 | 3163101 CPL
CPL's picture

This is awesome.

Thu, 01/17/2013 - 13:57 | 3162996 Flakmeister
Flakmeister's picture

A good a place as any:

By Matt Taibbi Secrets and Lies of the Bailout

... To guarantee their soundness, all major banks are required to keep a certain amount of reserve cash at the Fed. In years past, that money didn't earn interest, for the logical reason that banks shouldn't get paid to stay solvent. But in 2006 – arguing that banks were losing profits on cash parked at the Fed – regulators agreed to make small interest payments on the money. The move wasn't set to go into effect until 2011, but when the crash hit, a section was written into TARP that launched the interest payments in October 2008.

In theory, there should never be much money in such reserve accounts, because any halfway-competent bank could make far more money lending the cash out than parking it at the Fed, where it earns a measly quarter of a percent. In August 2008, before the bailout began, there were just $2 billion in excess reserves at the Fed. But by that October, the number had ballooned to $267 billion – and by January 2009, it had grown to $843 billion. That means there was suddenly more money sitting uselessly in Fed accounts than Congress had approved for either the TARP bailout or the much-loathed Obama stimulus. Instead of lending their new cash to struggling homeowners and small businesses, as Summers had promised, the banks were literally sitting on it.

Today, excess reserves at the Fed total an astonishing $1.4 trillion."The money is just doing nothing," says Nomi Prins, a former Goldman executive who has spent years monitoring the distribution of bailout money.

Nothing, that is, except earning a few crumbs of risk-free interest for the banks. Prins estimates that the annual haul in interest­ on Fed reserves is about $3.6 billion – a relatively tiny subsidy in the scheme of things, but one that, ironically, just about matches the total amount of bailout money spent on aid to homeowners. Put another way, banks are getting paid about as much every year for not lending money as 1 million Americans received for mortgage modifications and other housing aid in the whole of the past four years.

Thu, 01/17/2013 - 14:03 | 3163030 ParkAveFlasher
ParkAveFlasher's picture

This is what happens when "money" is reduced to a book entry, and restricted to being essentially valueless except as a physical record / denominator of some far-off exchange.  

This is what happens when you exclude value from a trade intermediary. 

This is what happens when third parties are corrupt.

Thu, 01/17/2013 - 14:10 | 3163059 Sophist Economicus
Sophist Economicus's picture

Yup, this continues to confirm my bias that Tabbi is a shill and doesn't understand rudimentary economics


Prins is a know, self-confessed shill, so no surprises in his remarks

Thu, 01/17/2013 - 14:29 | 3163147 rodocostarica
rodocostarica's picture

Yeah and Tiabbi thinks the Tea Party started with Santelli's famous rage piece rather than the Ron Paul Tea Party Fundraiser in December 07. Some good journalistic research.

Thu, 01/17/2013 - 16:03 | 3163554 A. Magnus
A. Magnus's picture

Nomi Prins is a WOMAN. If you can't get at least THAT right then the rest of your 'analysis' is questionable at best...

Thu, 01/17/2013 - 17:09 | 3163840 Orly
Orly's picture


Thu, 01/17/2013 - 14:28 | 3163144 trav777
trav777's picture

why TF would the banks (or anyone else) LEND ANYTHING to "struggling homeowners"??!

A struggling homeowner=person in default who doesn't really OWN anything except a big capital loss on a mccrapbox made of particle board.

NO aid to homeowners, NO aid to gd'd banks either

Thu, 01/17/2013 - 17:56 | 3164015 Mentaliusanything
Mentaliusanything's picture

If that $1.4 Trillion ever breaks out into the real World, then Ben's ass is going to pucker tighter than a Fishes bumhole.

It's not something I want to think about, least I start heavy drinking

Thu, 01/17/2013 - 13:58 | 3162999 Its_the_economy...
Its_the_economy_stupid's picture

Goldf surge couldn't be related to the 7 years needed by the Fed to cover Germany's Gold Call.

Thu, 01/17/2013 - 14:18 | 3163092 busted by the b...
busted by the bailout's picture

Yes, but it's all pieces of a whole.


Thu, 01/17/2013 - 18:35 | 3164172 hooligan2009
hooligan2009's picture

you watch the unwind of all the rehypothecation in the collateral markets over the next three to 2500..well first..then buzz lightyear kicks in

Thu, 01/17/2013 - 14:00 | 3163004 MillionDollarBoner_
MillionDollarBoner_'s picture

"Christine Lagarde appeared to comment that she does not believe in currency wars (or competitive devaluation) this morning..."

Christine Lagarde does not believe in big fat hairy cocks either...but she sure as hell has got one ;o) 

Thu, 01/17/2013 - 14:01 | 3163012 CPL
CPL's picture

Biggest clit you've ever seen with huge meat curtains.

Thu, 01/17/2013 - 14:10 | 3163038 MillionDollarBoner_
MillionDollarBoner_'s picture

...and its own ecosystem.

It's like a rainforest in there...

Edit: and while we are on it, those are not meatflaps, dude, they are cojones...;o)

Thu, 01/17/2013 - 14:21 | 3163107 CPL
CPL's picture


Thu, 01/17/2013 - 14:34 | 3163173 trav777
trav777's picture


Thu, 01/17/2013 - 14:50 | 3163245 francis_sawyer
francis_sawyer's picture



There ~ fixed it...

Thu, 01/17/2013 - 15:34 | 3163449 Terp
Terp's picture

Ok, this went from lol to ewww in three posts.


Well done gentlemen...

Thu, 01/17/2013 - 14:53 | 3163259 pods
pods's picture

Wow CPL that one was quite visual.

In fact, I had to see how a normal person would react so I copied it and sent it to Mrs. pods.



Thu, 01/17/2013 - 18:33 | 3164162 hooligan2009
hooligan2009's picture

along the lines of "show us your growler" and other un PC things I have heard people shout at strip other people told me they heard people shout I mean

Thu, 01/17/2013 - 14:00 | 3163007 semperfi
semperfi's picture

Which one is going to be the first to go Zimbabwe and print a $100Trillion note ???  Bets ?

Thu, 01/17/2013 - 14:02 | 3163015 CPL
CPL's picture

Japan, they are almost there already.

Thu, 01/17/2013 - 18:31 | 3164158 hooligan2009
hooligan2009's picture

japan is about to print its first quadrillion of yen debt...worth less than (non) radio-active toilet paper, but there you go

Thu, 01/17/2013 - 14:08 | 3163050 francis_sawyer
francis_sawyer's picture

Doesn't work that way in this system...


Can't you see?... The mythical "$100 Trillion Note" is just 100 electronic entries of $1 Trillion dollars each [which then, the PD's hold on deposit at the Fed & collect interest off of]... Then ~ they incrementally divvy it up amongst their cronies, who venture out in the world and buy up all the PHYSICAL STUFF they can find...

When the last atom of "stuff" has been procured [in a race with the Chinese who are doing the same]... Then the game is over...

Your only interest in the game is to decide what kind of 'special sauce' is needed to make your catfood taste like a gourmet meal...

Thu, 01/17/2013 - 14:02 | 3163019 Cognitive Dissonance
Cognitive Dissonance's picture

"BoJ Joins ECB And Fed On Unlimited Print Train"

That would explain the sudden woodie in Gold and Silver.

Thu, 01/17/2013 - 14:03 | 3163031 MillionDollarBoner_
MillionDollarBoner_'s picture


The IMF has principles?!?


Thu, 01/17/2013 - 14:06 | 3163041 Sudden Debt
Sudden Debt's picture

yes they do!

Principle 1: take care of your own
Principle 2: your own will take care of you
Principle 3: don't have more than 3 principles.

Thu, 01/17/2013 - 14:15 | 3163085 SAT 800
SAT 800's picture

Actually, I think principle number three is "never piss in your wastebasket when you can use your neighbors"; but I agree with you "in principle" !

Thu, 01/17/2013 - 14:12 | 3163068 edb5s
edb5s's picture

Beat me to it.

Thu, 01/17/2013 - 18:30 | 3164143 hooligan2009
hooligan2009's picture


(his new job probably)

Thu, 01/17/2013 - 14:04 | 3163032 Sudden Debt
Sudden Debt's picture

I just sold my gold calls for a nice 45% profit :)

let's not forget that tomorrow it's the 19th... option exp. day.

Thu, 01/17/2013 - 14:06 | 3163046 MillionDollarBoner_
MillionDollarBoner_'s picture

Dude...tomorrow is the 18th where I'm sat and OpExp is on the 26th.

Or is I crayzee?

Thu, 01/17/2013 - 14:26 | 3163136 CPL
CPL's picture

On the other side of the world it is always the next day.


mind = blown

Thu, 01/17/2013 - 18:00 | 3164026 Orly
Orly's picture

Or, as my brother would say, "It's five o'clock somewhere."

Thu, 01/17/2013 - 14:22 | 3163111 SAT 800
SAT 800's picture

I just covered my Jap. Yen Short contract for 5312.50$; for one contract ! The thing was on there for a month; I probably should have left it. Pray that Silver gets back above $33 SOON; i'm sitting on a Mar.'contract for $33 and change; LONG ! And I'm feeling the pain. Yours. Mine. Everybodys. Ouch. Come on somebody buy some silver, it's good for you.

Thu, 01/17/2013 - 14:29 | 3163146 fonzannoon
fonzannoon's picture

thats rough man. this move is total crap. metals going nowhere. i would not be surprised if they both have negaive years this year. this is gonna be a big fight. they want people thinking the market is the way to go. why bother with metals when you can cruise control higher with some stawks.

Thu, 01/17/2013 - 17:23 | 3163902 Going Loco
Going Loco's picture

When you have to start praying it's time to stop trading. God don't give no heed to traders' prayers.

Thu, 01/17/2013 - 14:28 | 3163142 SAT 800
SAT 800's picture

I've been outraded by a robotic Mr. Potatoe Head; oh the humanity !

Thu, 01/17/2013 - 18:12 | 3164076 Orly
Orly's picture


you can put the blame where it really belongs...

Thu, 01/17/2013 - 14:09 | 3163055 busted by the b...
busted by the bailout's picture

"This aggression will not stand!"


Fiat money is RAPIDLY losing any pretense of meaning.

Thu, 01/17/2013 - 14:25 | 3163129 SAT 800
SAT 800's picture

Talk is cheap. Couldn't you afford to buy an odd million $ or so of silver? If somebody doesn't get the price back up by the third week in March; I"m going to be so screwed. I hate making losses.

Thu, 01/17/2013 - 14:09 | 3163056 Jason T
Jason T's picture

I'd love to see Japan's bond market collapse from this Faustian deal.  

Thu, 01/17/2013 - 14:09 | 3163057 tooriskytoinvest
tooriskytoinvest's picture

WORLD DOLLAR PANIC IMMINENT? There Is A Currency War Raging World-Wide And Masses Close To Realizing Their Money Is Being Destroyed

Thu, 01/17/2013 - 14:14 | 3163076 Smuckers
Smuckers's picture

I am reminded of:

Tartlets....tartlets....tartlets?  The word has lost all meaning.


Thu, 01/17/2013 - 14:14 | 3163077 PUD
PUD's picture

So how much for a nearly extinct radioactive bluefin tuna now?

Thu, 01/17/2013 - 14:15 | 3163080 Quinvarius
Quinvarius's picture

Lagarde is one of the most ignorant, empty headed, dreamers the CB set has to offer.  She is a complete clown who will say anything she is told to say.  She is happy to go shopping once a week and cannot be bothered to actually understand the business of banking.  

Thu, 01/17/2013 - 14:18 | 3163093 SAT 800
SAT 800's picture

But she has a nice ecologically correct French car, a bicycle; I saw a picture of her riding it in Paris. So she couldn't be all bad.

Thu, 01/17/2013 - 14:23 | 3163120 ivana
ivana's picture

yes but you forgot that she's completely gray. In many cultures this is sign of ultimate wisdom.

Just check the pics of all main players... everyone's 100% grey hair ... obama is joining next ... than on the end of his mandate MSM will show pics before/after with conclusion that he had a very hard time :-)

Thu, 01/17/2013 - 14:24 | 3163122 rwe2late
rwe2late's picture

Actually, it is you who do not understand.

The CBs represent a cartel, a syndicate with the primary goal

of enriching and empowering their inner cabal.


Thu, 01/17/2013 - 14:18 | 3163097 ivana
ivana's picture

oooo yeah, next reset is really close .

than again same old printing printing ...................... until all valuable assets and collaterals disappear into veeeery foggy unclear ownership of ????

Thu, 01/17/2013 - 14:20 | 3163104 fonzannoon
fonzannoon's picture

what a fkin joke. all of it.

Thu, 01/17/2013 - 14:23 | 3163108 Peter Pan
Peter Pan's picture

When people realise that they have to sweat each week to put a few dollars away while Dimon, Blankfein and others are given free money with which to play, then perhaps there might be a moment of enlightenment for those helpless souls who get a negative return after taxes and inflation.

This game still has far to go.

Thu, 01/17/2013 - 14:23 | 3163118 monopoly
monopoly's picture

And, the icing on the cake...Take a look at those interest rates. Benny better get those inkjets going with a new song.

Thu, 01/17/2013 - 14:25 | 3163131 youngman
youngman's picture

On one side we have the debt ceiling in the USA.....on the other side we have ended QE ???? for many me there are two groups...those that QE....and the rest of the world trying to get away and out of the paper trash.....there is going to be some pissed off people and they see their hopes and dreams and economies fall because of this crap...and its all political...its not economic

Thu, 01/17/2013 - 14:39 | 3163195 busted by the b...
busted by the bailout's picture

What is this word "economic" you speak of?


Nobody cares about economics anymore; it was too dismal.

Thu, 01/17/2013 - 18:16 | 3164091 rwe2late
rwe2late's picture

 give me that old-time "political economy"

used before they wanted to explain away the distribution of wealth and power

as being an unavoidable result of the laws of supposed "economic science".

Thu, 01/17/2013 - 14:37 | 3163191 Mike in GA
Mike in GA's picture

It appears 2013 is the years of last last resort as the G-20 meme seems to be "if we can't reflate now, then it's all over."

We'll KNOW it's over if Krugman is called into the regime in 2013.

Krugman's oft-stated policy of monetary 'infinity & beyond'* exemplifies the idiocy of academic hubris.

Even a caveman knows debt on this scale, for these purposes, is disastrous.


*apologies to Buzz Lightyear 

Thu, 01/17/2013 - 14:39 | 3163197 rwe2late
rwe2late's picture

Bizarrely, the more dollars the US "prints",

the more dollars foreign banks must hold to support their export economy (their export oligarchy) by preventing their currency from appreciating.

That supports US profligacy and militarism, and also helps suppress inflation until such time as there may be a rush for the exit.

Thu, 01/17/2013 - 14:45 | 3163228 Orly
Orly's picture

Abe:  Wolf!  Wolf!

Hey, wait a minute.  I said that already...

Bear!  Bear!

(Gotta love idiot robots...)


Thu, 01/17/2013 - 15:17 | 3163375 mdtrader
mdtrader's picture

Crucial time for the USD/JPY. If it makes a weak new high for the rally and can't follow through above 90, then a significant correction could be on the cards. I wouldn't be surprised to see it give back at least half of the gains from the 78-90 rally. 

Thu, 01/17/2013 - 16:44 | 3163602 Orly
Orly's picture

Word is a major American bank bought a yard (another one of those words I've never used before.  It means a billion dollars notional...holy smokes!) worth of USD on JPY early this morning at 88.

The Japanese are looking to tank this rascal before the BoJ meeting so that Nomura and Mizuho can make bank on the rocket when the BoJ announces a half-trillion dollar (U$D...) global bond-buying program at their meeting on Monday, hence the jawboning earlier this week.

The USDJPY just broke 90, so it is clear that the real currency wars are going on right here in my basement.  The overnight is sure going to be interesting.  Get you some No-Doz.

I wouldn't be totally surprised to see it move back to the Daily Pivot at 88.5 before shooting the moon all the way to 95 next week or the week after.  Okay, okay maybe at least to the first resistance at 89...

Crazy times, eh?

Wishing you some green pips!


Thu, 01/17/2013 - 16:08 | 3163565 Clowns on Acid
Clowns on Acid's picture

Just buy equities and forget about any further chin music....Ben and his coterie of pencilled neck facsists will try to prove that they are "right"by printing until there ain't no more print to print with.

Ben will be proved wrong, however could be many more points higher from here.

Thu, 01/17/2013 - 18:29 | 3164135 hooligan2009
hooligan2009's picture

so far so good, so far so good (as the blonde falling from the high rise kept telling herself)

Thu, 01/17/2013 - 18:45 | 3164219 HeavydutyMexica...
HeavydutyMexicanOfTheNorthernKingdom's picture

AAAAAND they're off...!

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